China’s Silk Road

The name Silk Road conjures images of caravans, desert steppes and adventurers like Marco Polo navigating the ancient trading routes connecting China with Central Asia, the Middle East, Africa and Europe. China’s modern-day adaptation aims to revive those routes via a network of railways, ports, pipelines and highways. President Xi Jinping champions his pet project as a means to spur development, goodwill and economic integration, as well as find markets for China’s over-producing factories. Critics — both along and beyond the Silk Road routes — are wary of China’s push to spread its influence further west.The SituationXi has outlined a decades-long drive to grease the wheels of trade with infrastructure projects costing tens or even hundreds of billions of dollars. He said in January that more than 40 countries had signed formal agreements with China. Typical plans include the development of ports in Malaysia and Tanzania or highways in Pakistan and Tajikistan. Along the way, China is also encouraging its companies to invest in industrial projects such as utilities. To bankroll these ambitions, the Chinese government created the $40bn Silk Road Fund in 2014; already, it has backed a dam in Pakistan and a liquefied natural gas operation in Russia. Other funding sources include the Brics Development Bank and China’s $100bn Asian Infrastructure Investment Bank (AIIB) — an alternative to the World Bank that the US and Japan initially criticised for its less stringent social and environmental safeguards. China stands to gain not just by putting to work its underused industrial capacity and excess production of steel and other materials, but also by pushing its goal of deepening the global reach of its currency. Partner nations are weighing economic benefits against an increasingly dominant superpower’s demands. For example, a deal for a rail project in Thailand fell through because local officials refused to grant China’s request for commercial property rights. China will ask 28 world leaders to sign on to its signature globalisation policy at a summit in Beijing today.Xi first proposed reviving the Silk Road in 2013 and went on to refer to it as “One Belt, One Road” and the “Belt and Road Initiative”— a combination of an overland “belt” and a maritime “road.” Although the original trading routes were established more than 2,000 years ago, the Silk Road’s name — derived from the delicate fabric highly prized by the Roman elite — was coined only in the 19th century by a German geographer. In its heyday, paper, gunpowder, porcelain and spices were transported to the west; horses, woollen rugs and blankets, gold, silver and glass made the return journey. Just as monks used the routes to spread Buddhism, the modern Silk Road is not just about commerce: China floats visions of film festivals and book fairs, scholarships and jointly run schools, as well as cruise ships plying the maritime lanes via Southeast Asia and Africa.The ArgumentChina emphasises the Silk Road’s role in boosting industrialisation in the developing nations sandwiched between East and West. Economists agree that the initiative has the potential to stimulate Asian and global economic growth. Risks include political instability or poor governance (the Kyrgyz prime minister was forced to resign in 2016 over a contract award to a Chinese company) and long-shot developments turning into white elephants (like an international airport in southern Sri Lanka that hosts only a couple of flights a day). Certain projects — especially costly overland routes — may simply not be economically viable. Critics point to China’s increasingly assertive military, particularly in Asia’s waters, and speculate whether the development of ports might presage the establishment of naval bases (the so-called “string of pearls” theory). China’s rejection of a tribunal ruling on its South China Sea claims has also raised questions about its regard for the international rule of law. The plan’s success may in part depend on the attitudes of Russia (initially sceptical but increasingly warm) and India, which is closely watching developments in Pakistan.